TikTok’s rival Kuaishou Technology is weighing a Hong Kong IPO that could bring in much as $5 billion.
The Chinese short video-app is working with advisors on the listing that could occur as soon as next year, Bloomberg reported today, citing people familiar with the matter.
Kuaishou, backed by Chinese tech giant Tencent (HKEX: 00700) is the largest competitor to ByteDance owned short-video app Douyin, China’s version TikTok. News of the potential listing comes at a time when Washington has threatened to ban TikTok due to the alleged national security risk associated with the Chinese-owned platform
Recently, Oracle (NYSE: ORCL) struck a deal with ByteDance to make it a technology provider for TikTok.
Meanwhile, President Trump is displeased with the deal, objecting to the fact that ByteDance would still hold a majority stake in TikTok’s U.S. operation. Trump told reporters Wednesday that he would not yet approve the deal until further review.
He said it must be “100% as far as national security is concerned.”
As threats of the ban have been in the air for TikTok, short-video users have been looking for alternatives. Downloads of Kuaishou’s short-video Zynn in the U.S. have “spiked” in recent months, according to Bloomberg.
But still, most of Kuaishou’s business is focused on China.
In the first six months of the year, its daily live-streaming users hit 170 million versus 100 million at the end of December.
Also, Kuaishou has a deal with the e-commerce giant JD.com (Nasdaq: JD) to sell products through an in-app store. On Kuaishou, more than 100 million daily users are engaged with online retail business.
In terms of total daily active users, Douyin and Kuaishou dominate China’s short video market with more than 400 million and 300 million users, respectively.
Last year, when Kuaishou was said to considering an IPO in New York, the company was raising $1 billion in a funding round that would have valued it at $25 billion. Currently, it holds a valuation of at least $29 billion in the secondary market, Bloomberg said.
But deliberations of the IPO are still in the early stages, meaning offering size and timing could change.